Tuesday, July 10, 2012

Contempt Orders

The test for contempt is well-known. The three essential requirements for a finding of contempt are
set out in Prescott-Russell v. G. (N.)
(2006), 29 RFL (6th) 92. The test
requires:

(i) The order breached must clearly and
unequivocally state what should and should not be done;

(ii) The breach
of the order must be deliberate and willful; and

(iii) The
evidence must show contempt beyond reasonable doubt.

One issue that is seldom considered is what limits are
placed on the order breached by the underlying statutory basis of that
order. In Davydov v. Kondrasheva, 2012 ONCA 488 that basis limited the order
so that the breach alleged could not be proven.

The Court made an order for the non-dissipation of assets in
a family law context – a very common type of family law order. The order was pursuant to the Family Law Act.

Sections 12 and 40 of the Family Law Act, allow for orders regarding non-dissipation of
assets.

Section 12 provides as follows:

In an application under section 7
or 10, if the court considers it necessary for the protection of the other
spouse’s interests under this Part, the court may make an interim or final
order,

(a) restraining the depletion of
a spouse’s property; and

(b) for the possession,
delivering up, safekeeping and preservation of the property.

Section 40 provides that:

The court may, on application,
make an interim or final order restraining the depletion of a spouse’s property
that would impair or defeat a claim under this part.

A limitation implicit in the statute is that orders are to
restrain depletion that would impair or defeat an equalization claim. Accordingly, even though an order may not
expressly say so, if a payment is made that does not impair or defeat such a
claim there is no contempt.

In Davydov the
husband paid a vast sum to an off-shore individual and said it was to pay a
debt existing before the marriage. The
lower court found contempt but the Court of Appeal set aside the order because,
if properly made to pay a debt existing before marriage there was not
impairment or defeating of the equalization claim. The Court of Appeal did say that, following
trial and determination of the validity of the payment, the contempt motion
could be renewed.

While arising in the
family context the reasoning is applicable widely.